{"id":6164,"date":"2013-01-07T00:00:00","date_gmt":"2013-01-06T11:00:00","guid":{"rendered":"https:\/\/www.farmersweekly.co.nz\/chinas-yili-to-buy-oceania-dairy-for-214-million\/"},"modified":"2013-01-07T00:00:00","modified_gmt":"2013-01-06T11:00:00","slug":"chinas-yili-to-buy-oceania-dairy-for-214-million","status":"publish","type":"post","link":"https:\/\/www.farmersweekly.co.nz\/news\/chinas-yili-to-buy-oceania-dairy-for-214-million\/","title":{"rendered":"China’s Yili to buy Oceania Dairy for $214 million"},"content":{"rendered":"Reading Time: <\/span> 2<\/span> minutes<\/span><\/span>

Yili will acquire Oceania to access its land resource consents to build a plant over 38 hectares in South Canterbury, according to a notice on the Shanghai Stock Exchange on Dec. 18. The Chinese firm said it's attracted by New Zealand's relatively cheap raw milk and the prospect of the free-trade agreement with China completely removing Chinese import tariffs by 2020.<\/p>\n

The plant is scheduled to be completed by June 2014 operating at 60% capacity, with annual full capacity of 47,000 tonnes expected in the 2016\/17 year.<\/p>\n

The deal is subject to Overseas Investment Office and Chinese government approval.<\/p>\n

Chinese investment in New Zealand has been a heated topic in recent years after bids to buy large tracts of farm-land forced the government to announce a u-turn on its plans to free up overseas investment and a High Court ruling made the Overseas Investment Office impose a more rigorous analysis of foreign purchases.<\/p>\n

Oceania Dairy sold milk supply contracts to Synlait Milk, which is half-owned by China's Bright Dairy, last year after failing to raise about $75M to build a milk powder plant near Glenavy that would have processed 220M litres of milk a year, producing 32,000 tonnes of powder.<\/p>\n

Yili said it has a preliminary cooperation agreement with some local farmers to supply the plant, and indicated plans to draw on Fonterra Cooperative Group's regulated supply of raw milk.<\/p>\n

Oceania Dairy director Don Brash told the NewZealandInc.com website that Yili had to announce the deal once its board had decided to go ahead.<\/p>\n

Yili had been named as a potential suitor to New Zealand Dairies' South Canterbury milk processing plant in 2010, when Russian owner Nutritek Group started shopping around for a buyer.<\/p>\n

Fonterra ultimately bought the plant this year out of receivership, and a phantom buyer claiming to have offered a better deal said it missed out because it needed OIO approval.<\/p>\n

© BusinessDesk 2013<\/p>\n","protected":false},"excerpt":{"rendered":"Chinese dairy firm Inner Mongolia Yili Industrial Group plans to spend $214 million building an infant formula plant in South Canterbury in a deal that will see it take over Oceania Dairy Group.\n","protected":false},"author":16,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_FSMCFIC_featured_image_caption":"","_FSMCFIC_featured_image_nocaption":"","_FSMCFIC_featured_image_hide":"","footnotes":""},"categories":[3],"tags":[],"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t